Are you a Denver property owner? Learn everything about Colorado’s short-term rental agreement laws in our comprehensive guide to stay compliant and protect your investment.
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Colorado Short-Term Rental Agreement Laws: A Complete Guide

Managing a short-term rental in Denver requires more than just listing your property and welcoming guests. Colorado’s regulatory landscape for short-term rentals has evolved significantly in recent years, making compliance increasingly important for property owners. Whether you’re new to the STR market or an experienced host, understanding the legal requirements for your rental agreements is essential to protect your investment and avoid costly penalties. This guide breaks down everything Denver property owners need to know about Colorado’s short-term rental agreement laws.

Key Components of Colorado Short-Term Rental Agreements

Creating a legally sound rental agreement in Colorado requires attention to several state-specific elements. Your short-term rental agreement isn’t just paperwork—it’s your first line of defense against potential disputes and liability issues.

In Colorado, a comprehensive STR agreement must include:

Primary License Information: Denver requires all short-term rental operators to obtain a license and include this license number in all agreements and listings. This license must be renewed annually, and operating without one can result in significant fines.

Local Tax Requirements: Colorado has specific tax collection requirements for short-term rentals. Your agreement should clearly state that guests will be charged applicable state lodging taxes (currently 4.75%) plus any local taxes. Denver adds an additional 10.75% lodger’s tax that must be collected and remitted.

Insurance Disclosures: Colorado law requires transparency regarding insurance coverage. Your agreement should specify what is and isn’t covered by your property insurance, and whether guests should consider additional coverage for their belongings.

Primary Residence Verification: Denver’s regulations stipulate that short-term rentals can only operate in the owner’s primary residence. Your agreement should include language confirming this status to demonstrate compliance.

Colorado-Specific Regulations for Guest Limitations

Unlike traditional long-term leases, short-term rental agreements in Colorado must address specific occupancy and usage restrictions.

Your rental agreement should clearly outline:

Occupancy Limits: Denver regulations typically restrict occupancy to no more than 2 adults per bedroom plus 2 additional guests. Your agreement should state these limits explicitly to prevent overcrowding issues.

Noise Ordinance Compliance: Colorado communities, especially in residential areas, have strict noise ordinances. Include specific quiet hours (typically 10 PM to 7 AM) and consequences for violations.

Parking Restrictions: Many Colorado neighborhoods have specific parking regulations. Your agreement should detail available parking options and any restrictions, particularly in areas with limited street parking or during snow emergencies.

Required Disclosures for Colorado STR Agreements

Colorado law mandates several specific disclosures in short-term rental agreements to protect both owners and guests.

Health and Safety Disclosures: Your agreement must acknowledge compliance with Colorado’s safety requirements, including functioning smoke and carbon monoxide detectors, fire extinguishers, and emergency exit plans.

Altitude Sickness Warning: For properties in higher elevations (which includes much of Denver and the surrounding areas), a disclosure about altitude sickness symptoms and precautions is strongly recommended.

Marijuana Use Policy: Given Colorado’s legal status regarding recreational marijuana, your agreement should explicitly state your property’s policy on consumption, including any restrictions on smoking indoors.

Water Usage Restrictions: Many Colorado communities have seasonal water restrictions. Include information about any current restrictions that might affect guests during their stay.

Enforcement and Penalties for Non-Compliance

Understanding the consequences of non-compliance is crucial for Denver property owners. Colorado takes short-term rental regulations seriously, with active enforcement mechanisms in place.

Denver’s enforcement approach includes:

Regular Compliance Checks: City officials regularly review online listings to ensure they display valid license numbers and comply with primary residence requirements.

Complaint-Based Investigations: Neighbors can report suspected violations, triggering inspections and potential penalties.

Escalating Fine Structure: Violations typically start with warnings but can escalate to fines ranging from $150 for first offenses to $999 for repeated violations, with the possibility of license revocation for serious or persistent non-compliance.

Ready to Protect Your Denver Short-Term Rental?

Navigating Colorado’s short-term rental laws doesn’t have to be overwhelming. At Simplify Renting, we stay current with all local regulations so you don’t have to. Our full-service property management includes creating compliant rental agreements tailored to your specific property, handling all guest communications, and ensuring you meet every legal requirement.

Let us handle the complex legal details while you enjoy increased revenue without the hassle. Contact our Denver team today for a free consultation and discover how we can help you maximize your rental income while maintaining perfect compliance with Colorado’s rental laws.